2022 (6) TMI 711 - AT - Service Tax

Refund of CENVAT Credit - rejection of refund on the ground observing that refund was allowable only in case of unutilised credit due to export, and refund was not allowable for not being able to carry forward part of cenvat credit to GST regime - HELD THAT - The Commissioner (Appeals) has held that the respondent assessee is entitled to refund of the balance amount of cenvat credit. However, he observed that it is subject to merits and compliance under Section 142(9)(b) of the CGST Act. From plain reading of the provisions of Section 142(9)(b) of the CGST Act, it is found that there is no further compliance or merit required to be seen. This section very clearly mentions that, if any, additional amount is found to be available as credit in favour of an assessee on filing of the revised return as per law, and pursuant to such return, if any, amount is found refundable then the same shall be refunded to the assessee under the existing law notwithstanding anything contrary contained in the said law, other than unjust enrichment. There is no further inquiry required in the matter and in view of the categorical finding of the Commissioner (Appeals) - the assessee is entitled to refund - Appeal allowed - decided in favor of appellant.

Summary

Issues involved:
1. Whether the Commissioner (Appeals) rightly remanded the matter of refund for further examination to the Court below.

Analysis:
The appellant, a service provider registered with the Service Tax Department, filed a refund application after realizing they had not taken cenvat credit on certain invoices and were entitled to credit for service tax paid under RCM after a specific date. The Adjudicating Authority rejected the refund claim, stating that refunds were only allowable in cases of unutilized credit due to export, not for the inability to carry forward part of the cenvat credit to the GST regime. The Commissioner (Appeals) found that the appellant was eligible for a refund of the balance cenvat credit under the transitional provision of Section 142(9)(b) of the CGST Act. The Commissioner observed that the appellant had complied with the prescribed procedures and remanded the matter for recalculation of the refund amount.

The Revenue appealed before the Tribunal, arguing that the Commissioner (Appeals) lacked the power to remand the matter and should have made a definitive decision. The respondent's counsel contended that no further compliance was necessary under Section 142(9)(b), and the Commissioner (Appeals) could have granted the refund without remanding the matter. The Tribunal examined the provisions of Section 142(9)(b) and found that if any additional amount is found refundable to an assessee upon filing a revised return within the specified time limit, the same shall be refunded under the existing law. The Tribunal held that no further inquiry was necessary, and based on the Commissioner (Appeals) finding, the assessee was entitled to the refund. The Tribunal allowed the appeal, directing the Adjudicating Authority to grant the refund within sixty days along with interest under Section 11BB of the Central Excise Act.